A stay of the “arbitration rule” by the Consumer Financial Protection Bureau (CFPB) will not be sought by the comptroller of the currency, given that Congress is considering use of the “Congressional Review Act” to overturn the rule, the Office of the Comptroller of the Currency announced today.
Acting Comptroller Keith Noreika said in the statement that he would not ask the Financial Stability Oversight Council (FSOC) to stay the effective date of Sept. 18 for the rule, which was announced earlier this month by consumer bureau. “I hope Congress will act on this opportunity to preserve effective alternatives for consumers to resolve their disputes without lengthy and costly litigation and to reduce the “piling on” of legal and regulatory burden that I discussed in my testimony before the U.S. Senate Committee on Banking, Housing, and Urban Affairs, on June 22, 2017.
Noreika stated that the OCC has “only begun its review” of the CFPB’s data and analysis underlying the agency’s final rule. “It is important that the OCC economists take the time necessary to conduct their independent review of the data and analysis used to support and develop the Final Rule,” Noreika stated. “Unfortunately, since the CFPB published the rule in the Federal Register prior to providing its data for our analysis and we have requested additional data in order to conduct a thorough review, the OCC cannot complete our thorough review in the limited time before a petition must be filed with the Financial Stability Oversight Council (FSOC).”
The “arbitration rule” would ban mandatory arbitration clauses in loan agreements, such as clauses covering consumer financial products, including credit cards and bank accounts, and which block consumers from joining in class actions to sue for alleged wrongdoing.